5.1 Springfield High School Springfield School District Delaware County - Pennsylvania Master Plan Presentation Town Hall Meeting 5 Project Cost Estimates/ Project Financing Strategy / Tax Impact February 4th, 2015
Town Hall Meetings 5.2 Town Hall Meeting 1 (October 16 th, 2014) Repeat Presentation of May 22, 2014 Board Meeting Town Hall Meeting 2 (November 13 th, 2014) Existing Building / Right-Sizing / Education Model Town Hall Meeting 3 (December 11 th, 2014) Phasing / Traffic and Parking Town Hall Meeting 4 (January 14 th, 2015) Community/ Academic / Athletics and Recreation / Sustainability Town Hall Meeting 5 (February 4 th, 2015) Project Cost Estimates/ Project Financing Strategy / Tax Impact Town Hall Meeting 6 (March 19 th, 2015) Recap / Summary / Options for Moving Forward
WHY? 5.3 Code Roofing Windows Envelope Electric Asbestos Roof Deck HVAC Plumbing Renovation Challenges
5.4 Town Hall Meeting 5 Project Cost Estimate / Project Financing Strategy / Tax Impact Presentation Outline Project Cost Estimates Renovation Discussion Project Financing Strategy Tax Impact Discussion
Project Cost Estimates 5.5
5.6 Maintain Existing Building Renovate Existing Building Leamy Avenue New Building Saxer Avenue New Building Four Options Compared Detailed Review for Project Cost
Budget Process 5.7 Common Data, Phasing Assumptions, & Plan Diagrams, for each Scheme Premises for Budget Process: 3 Independent Cost Estimates Estimates Reviewed and Vetted by Committee Conceptual Budget 2013 Costs 40 Year + Project Life Public Bid / Multiple Prime Prevailing Wage Soft Costs Competitive Selection State Contract Bid Validated and Established The Estimates PROJECT COST ESTIMATE
Project Cost Estimates / Phasing 5.8 COSTS Estimated Project Cost Range (2013 cost) Estimated Project Cost Range (est. 2019 cost) 2017 Construction Start 2019 Midpoint PHASING/SCHEDULE Estimated Base Construction Duration Estimated Overall Project Duration (incl. phasing) TEMPORARY SPACE Temporary Classrooms, etc. required Maintain Exstg Renovate Exstg New Leamy Ave. New Saxer Ave. $76M $92M $101M $123M $103M $125M $99M $121M $90M $110M $121M $148M $123M $150M $118M $144M $100.3M $133.8M $136.4M $131M 3.2 yrs. (38 months) 3.7 yrs. (44 months) 3.25 yrs. (39 months) 4.7 yrs. (56 months) 3.25 yrs. (39 months) 5 yrs. (60 months) 1.75 yrs. (21 months) 3 yrs. (36 months) Yes Yes No No PROJECT COST ESTIMATE
Area (SF) Summary 5.9 PROJECT COST ESTIMATE
Scope of Work Summary 5.10 PROJECT COST ESTIMATE
Scope of Work Summary 5.11 PROJECT COST ESTIMATE
Project Budget Summary Template 5.12 PROJECT COST ESTIMATE
Budget Summary 5.13 PROJECT COST ESTIMATE
Executive Cost Summary 5.14 Total SF Renovated & New (w/o temp space): 264,430 304,290 242,625 242,625 MAINTAIN EXISTING RENOVATE EXISTING LEAMY AVENUE SAXER AVENUE $/sf $/sf $/sf $/sf SITE ACQUISTION $0 $0.00 $0 $0.00 $0 $0.00 $15,000 $0.06 SITEWORK Site Prep/Site Development CONSTRUCTION & FIXED EQUIPMENT $8,829,993 $33.39 $20,579,827 $67.63 $29,584,371 $121.93 $27,235,993 $112.26 $61,045,078 $230.86 $71,248,249 $234.15 $63,037,035 $259.81 $61,592,938 $253.86 PROFESSIONAL FEES $5,341,255 $20.20 $7,033,483 $23.11 $7,467,123 $30.78 $7,201,650 $29.68 FURNISHINGS & EQUIPMENT $1,743,365 $6.59 $1,656,795 $5.44 $2,388,250 $9.84 $2,388,250 $9.84 SUBTOTAL ALL PROJECT COSTS: $76,959,691 $291.04 $100,518,353 $330.34 $102,476,780 $422.37 $98,433,832 $405.70 OWNER DIRECT COSTS $7,118,771 $26.92 $11,559,611 $37.99 $11,784,830 $48.57 $11,319,891 $46.66 TOTAL PROJECT COSTS: (2013 Dollars) $84,078,462 $317.96 $112,077,964 $368.33 $114,261,610 $470.94 $109,753,722 $452.36 Escalation Factor - assume 2017 start, 2021 completion, midpoint 2019 @ 3%/years - 6 years PROJECTED DOLLARS: (2017 Construction Start) $100,394,081 $379.66 $133,826,950 $439.80 $136,434,337 $562.33 $131,051,684 $ 540.14 PROJECT COST ESTIMATE
Are these Budgets right? compared to other projects it seems out of line 5.15 1. Conceptual Budgets projected into future Everything will ultimately go through a public bid process or be vetted via a formal selection process 2. Direct comparisons are difficult Prevailing Wages (significantly higher in SE PA) Overall Geographic Market Conditions Building Construction Types and Configurations Vary A highly efficient building will have larger $/sf cost but not necessarily higher overall costs Overall level of project complexity/phasing etc. Time of Completion 3. Incomplete or missing information Many sources quote raw building costs only or Costs can be incomplete PROJECT COST ESTIMATE
The Effect of Prevailing Wages on Project Costs 5.16 PROJECT COST ESTIMATE
Comparative Data 5.17 Project $/SF - 2013 Dollars High School Master Plan compared to comparable projects in SE Pennsylvania, with a national measure $600 $507 $500 $452 $458 $467 $471 $400 $318 $339 $340 $356 $368 $395 $300 $200 $180 $100 $- PROJECT COST ESTIMATE OF NOTE: SE PA is a high-cost construction market Unionville-Chadds Ford includes existing sf Initial investment in a highly efficient building = greater $/sf, but not necessarily greater $/student
Comparative Data 5.18 Project $/Student - 2013 Dollars High School Master Plan compared to comparable projects in SE Pennsylvania, with a national measure $100,000 $90,000 $86,420 $88,006 $88,250 $88,814 $89,970 $94,134 $80,000 $70,000 $66,204 $72,157 $60,000 $57,698 $57,984 $50,000 $45,000 $40,000 $32,714 $30,000 $20,000 $10,000 $- PROJECT COST ESTIMATE OF NOTE: SE PA is a high-cost construction market Unionville-Chadds Ford includes existing sf Initial investment in a highly efficient building = greater $/sf, but not necessarily greater $/student
Budget Process Case Study - Springfield Literacy Center 5.19 Conceptual Budget January 2007 Building Construction Cost: $280 / sf Project Cost: $462 / sf Final Cost April 2010 Building Construction Cost: $283 / sf Project Cost: $468 / sf PROJECT COST ESTIMATE
Renovation Discussion 5.20
RENOVATION DISCUSSION 5.21
Average Life of Building Elements 5.22 Building System Average Life (years) % of Total Building Cost Foundations 100+ 6% Structural frame 100+ 10% Floor deck 75 2% Roof deck 75 1% Roofing 20 3% Exterior walls 75 8% Windows 30 7% Exterior doors 30 1% Partitions 50 5% Interior Doors 30 2% Flooring 7 3% Ceilings 20 2% Furnishings 25 6% Plumbing 40 7% Fire Protection 50 2% HVAC 20 19% Electrical 30 16% RENOVATION DISCUSSION
Elements of Springfield HS Building Life Extension Capital Renewal Replacing Aged Building Components Examples: Roofing Plumbing, piping, drains, fixtures Mechanical Equipment Electrical Systems Components Furnishings Brick pointing, masonry repairs Painting Flooring Ceilings Doors Bathroom accessories Lockers Kitchen equipment Theater & stage equipment Gym & athletic equipment Auditorium Seats Track, tennis, court surfaces Sidewalks, Curbs Driveway & Parking paving Capital Improvements Upgrading Building Components Examples: Modern HVAC System Modern Electrical System Sprinkler System, fire service Reconfigured Floor Plan LED lighting Improved Windows New Main Entrance Security & Access Control Accessibility Construction Regulation Size Gym Construction Building Automation System Code compliance rants, entrances, exits Fire separation walls Elevator code upgrades Data outlets, wiring Seismic code compliance Auditorium modernization Adding insulation to walls Synthetic Turf Field Asbestos Removal 5.23 RENOVATION DISCUSSION
4% Rule for Facility Maintenance & Renewal 5.24 Annual investment of 3% - 4% of replacement cost in repairs & upgrades: Maintains buildings in like new condition Difficulty of implementation (ongoing expense) Service Life Extension Program as applied at Scenic, Sabold, ETR Other Considerations: Renovations are labor intensive Labor @ $100/hr. +/- Bearing Wall Construction Ability to Occupy During Construction RENOVATION DISCUSSION
Project Financing Strategy and Tax Impact 5.25
PROJECT FINANCING STRATEGY AND TAX IMPACT CASE STUDY 1 - Bridge Street, Morton 5.26 $10,000 Assessed Value: $97,210 $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 5.7% 9.4% 9.7% 9.1% $2,912 $3,079 $3,185 $3,195 $3,178 $2,000 $1,000 $- Current Maintain Renovate New Leamy New Saxer
PROJECT FINANCING STRATEGY AND TAX IMPACT CASE STUDY 2 Kent Road, Springfield 5.27 $10,000 Assessed Value: $147,590 $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 5.7% 9.4% 9.7% 9.1% $4,422 $4,674 $4,836 $4,851 $4,825 $3,000 $2,000 $1,000 $- Current Maintain Renovate New Leamy New Saxer
PROJECT FINANCING STRATEGY AND TAX IMPACT CASE STUDY 3 Lynbrook Road, Springfield 5.28 $10,000 Assessed Value: $168,840 $9,000 $8,000 $7,000 $6,000 $5,000 5.7% 9.4% 9.7% 9.1% $5,059 $5,348 $5,532 $5,550 $5,520 $4,000 $3,000 $2,000 $1,000 $- Current Maintain Renovate New Leamy New Saxer
PROJECT FINANCING STRATEGY AND TAX IMPACT CASE STUDY 4 Kelli Lane, Springfield 5.29 $12,000 Assessed Value: $293,291 $11,000 $10,000 $9,000 5.7% 9.4% 9.7% 9.1% $8,787 $9,289 $9,610 $9,641 $9,588 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- Current Maintain Renovate New Leamy New Saxer
PROJECT FINANCING STRATEGY AND TAX IMPACT CASE STUDY 5.30 $10,000 $9,000 $8,000 $8,787 $9,289 $9,610 $9,641 $9,588 Bridge Street, Morton $97,210 Kent Road, Springfield $147,590 $7,000 $6,000 $5,000 $4,000 $5,059 $4,422 $5,348 $5,532 $5,550 $5,520 $4,674 $4,836 $4,851 $4,825 $3,000 $2,000 $2,912 $3,079 $3,185 $3,195 $3,178 $1,000 Lynbrook Road, Springfield $168,840 Kelli Lane, Springfield $293,291 $- Current Maintain Renovate New Leamy New Saxer
PROJECT FINANCING STRATEGY AND TAX IMPACT Highlights 5.31 Proposed Master Plan Financing - Key Points 1. Tax impact to the average homeowner Approximately 1% per year to finance the project - increase phased in over 9 years Average tax increase equal to $27 to $47 per year Average home in Springfield and Morton is assessed at $146,050 2. Project financing Project will be financed with new 20 to 25 year amortization bonds that will wrap around existing bonds scheduled to be paid off in 2025 Bonds will be issued over the project life expected to be 6 years starting in 2016 Debt service payments will increase upon issuance of the bonds and will be included in the operating budget at that time 3. Opportunities to reduce financing costs and taxes Historical low interest rate environment Plan Con reimbursement from Harrisburg Community participation naming rights, grants, private support
PROJECT FINANCING STRATEGY AND TAX IMPACT Financing Summary for Proposed Master Plan Options 5.32 Maintain Existing Building Renovate Existing New Leamy Ave. New Saxer Ave. Total New Principal $100,000,000 $134,000,000 $137,000,000 $132,000,000 Type of Debt Amortization Term Projected required phased in millage increases through 6/30/2023 9 years Projected tax increase for current median assessed value of $146,050 Projected tax increase per $100,000 of assessed value Wrap Around Fixed & Variable 20-25 years Wrap Around Fixed & Variable 20-25 years Wrap Around Fixed & Variable 20-25 years Wrap Around Fixed & Variable 20-25 years 1.58 mills 2.59 mills 2.69 mills 2.52 mills $250 (Average $28 per year) $171 (Average $19 per year) Projected Tax Increases Phased in Over 9 Year Period $410 (Average $46 per year) $280 (Average $31 per year) $425 (Average $47 per year) $291 (Average $32 per year) $399 (Average $44 per year) $273 (Average $30 per year)
PROJECT FINANCING STRATEGY AND TAX IMPACT Projected Master Plan Annual Tax Increase Median Assessed Value of $146,050 5.33 $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $- TOTAL: 10/1/2020 $32 $250 10/1/2019 $31 $217 $30 $186 10/1/2018 $29 $156 $28 $127 10/1/2018 $27 $99 $52 $410 10/1/2020 $51 $357 10/1/2020 10/1/2019 10/1/2019 $49 $307 $48 $257 10/1/2018 10/1/2018 $47 $209 $54 $425 $53 $371 $51 $318 $50 $267 $48 $217 $45 $163 $47 $169 $51 $399 10/1/2020 $50 $348 $48 $298 $47 $250 10/1/2018 $45 $204 $44 $158 10/1/2018 10/1/2018 10/1/2018 $44 $118 $45 $122 $43 $114 $27 $72 $42 $74 $44 $77 $41 $72 $26 $45 $19 $19 $31 $31 $33 $33 $31 $31 12/1/2017 12/1/2017 12/1/2017 12/1/2017 Maintain Annual $250 Maintain Cumulative Renovate Annual TOTAL: $410 9/1/2016 9/1/2016 9/1/2016 Renovate Cumulative New Leamy Annual TOTAL: $425 TOTAL: New Leamy Cumulative New Saxer Annual $399 2021/22 10/1/2019 New Saxer Cumulative 2023/24 2022/23 2019/20 2018/19 2017/18 2016/17 2015/16 2014/15
Annual Tax Millage Increase - Springfield School District 5.34 10.00% 9.00% 8.00% 7.00% 6.99% 6.48% HISTORICAL 10 Year Avg. 4.40% HYPOTHETICAL Total Tax Millage Projection (Includes District Operations & Project Debt ) 6.00% 5.73% 5.00% 4.94% 4.00% 3.98% 3.54% New and Renovate 3.00% 2.00% 2.76% 2.70% 1.98% 2.25% 2.25% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 2.60% 2.60% 2.60% 2.60% 2.60% 2.60% 2.60% 2.60% 2.60% Maintain 1.00% 0.00% PROJECT FINANCING STRATEGY AND TAX IMPACT
PROJECT FINANCING STRATEGY AND TAX IMPACT CURRENT 2015 v. MAINTAIN 2023 v. NEW 2023 5.35 June 2015 Current June 2023 Maintain June 2023 New Bond principal & interest 9% Fund Balance 11% Bond principal & interest 10% Fund Balance 10% Bond principal & interest 11% Fund Balance 10% Grants 1% Grants 1% Teaching, Learning & Admin. costs 79% Teaching, Learning & Admin. costs 79% Teaching, Learning & Admin. costs 78% Grants 1%
5.36 Maintain Existing Renovate Existing New Leamy New Saxer Discussion
Town Hall Meetings 5.37 Town Hall Meeting 1 (October 16 th, 2014) Repeat Presentation of May 22, 2014 Board Meeting Town Hall Meeting 2 (November 13 th, 2014) Existing Building / Right-Sizing / Education Model Town Hall Meeting 3 (December 11 th, 2014) Phasing / Traffic and Parking Town Hall Meeting 4 (January 14 th, 2015) Community/ Academic / Athletics and Recreation / Sustainability Town Hall Meeting 5 (February 4 th, 2015) Financial Options / Cost Options / Tax Impact Town Hall Meeting 6 (March 19 th, 2015) Recap / Summary / Options for Moving Forward
APPENDIX 5.38
Examples of Incomplete Information 5.39 Actual PASD Budget ($/sf) (per PDE Act 34 Documents) Construction Costs: Base Building Construction Costs $261.00 Sitework $ 77.00 Construction Add Alternates $ 33.00 $371.00 Total Project Costs (w/o land acquisition) $497.12 Cost/square foot $217 PROJECT COST ESTIMATE
Comparative Data 5.40 School Planning & Management February 2014 PROJECT COST ESTIMATE
Projected Master Plan - Annual Debt Issues 5.41 9/1/2016 12/1/2017 10/1/2018 10/1/20182 10/1/2019 10/1/2020 $134,000,000 10/1/2020 $10,000,000 $137,000,000 10/1/2020 $10,000,000 $132,000,000 10/1/2020 $10,000,000 $100,000,000 10/1/2020 $10,000,000 10/1/2019 $35,920,000 $37,060,000 10/1/2019 10/1/2019 $35,160,000 10/1/2019 $23,000,000 10/1/2018 10/1/2018 $35,920,000 $37,060,000 10/1/2018 $35,160,000 10/1/2018 $23,000,000 10/1/2018 $24,000,000 10/1/2018 10/1/2018 10/1/2018 $32,160,000 $32,880,000 $31,680,000 12/1/2017 $10,000,000 12/1/2017 $10,000,000 12/1/2017 $10,000,000 12/1/2017 $10,000,000 9/1/2016 $10,000,000 9/1/2016 $10,000,000 9/1/2016 $10,000,000 9/1/2016 $10,000,000 Maintain Existing Renovate Existing New Leamy New Saxer PROJECT FINANCING STRATEGY AND TAX IMPACT
Historical Residential RE Taxes as a % of PA Personal Income 5.42 PROJECT FINANCING STRATEGY AND TAX IMPACT Source: Pennsylvania Department of Education
Projected Residential RE Taxes as a % of PA Personal Income 5.43 PROJECT FINANCING STRATEGY AND TAX IMPACT Source: SSD Projection Based on Historical Growth
PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL INTEREST INTEREST INTEREST INTEREST INTEREST INTEREST INTEREST Current Outstanding Debt 5.44 $5,000,000 INTEREST INTEREST INTEREST INTEREST $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 PROJECT FINANCING STRATEGY AND TAX IMPACT
Annual v. Projected Debt Service Summary 5.45 Current Debt Service - Principal Projected Debt Service - Principal Current Debt Service - Interest Projected Debt Service - Interest $15,000,000 $12,000,000 $9,000,000 $6,000,000 $3,000,000 $- PROJECT FINANCING STRATEGY AND TAX IMPACT
Operating Cost Summary 5.46 New Building Existing Building Maintain/Renovate Total square footage 206,000 270,548 Operating & maintenance costs per square foot (2014-15 projected $) $6.66 $6.66 Utility costs per square foot (Based on prior 4 year average) $1.33 $1.33 Total operating and utility costs per square foot $7.99 $7.99 Total projected operating costs $1,645,940 $2,161,680 Projected reduced annual operating costs based on 2014-15 costs $515,740 Projected annual savings in 2020-21 based on 2% inflation growth $580,810 PROJECT FINANCING STRATEGY AND TAX IMPACT